The Officeminium : alternative tenure choice in the Office Business Center market

Abstract

The Office Business Center (OBC) is a shared office facility, which is fully equipped, staffed and furnished. Many small business and sole proprietors choose OBC space over traditional leased office space because it alleviates the upfront cost and time required to maintain and manage an effective office infrastructure. Additionally, the persistence of low commercial mortgage interest rates have helped to witness a rise in office space ownership through the growth of the office condominium market- a market which is also dominated by small businesses and sole proprietorships. This thesis investigates the viability of a new real estate product, the Officeminium(TM). The Officeminium(TM) is a hybrid product which combines the ownership tenure of the office condominium and the full service environment of an OBC. The Officeminium(TM) provides a subset of small business owners and small proprietors with a hedge against rent risk and opportunistic agency, while affording office building owners and developers with a means to reduce excess building capacity and potentially increase the value of their real estate asset.